Monday, Mizuho (NYSE:MFG) maintained its Outperform rating on Air Products (NYSE:APD) & Chemicals Inc. (NYSE: APD) and increased the price target to $385 from $360. The adjustment follows a review of the company's latest 10-K filing and initial proxy statements from both APD and Mantle Ridge.
The financial institution highlighted the significant growth in Air Products & Chemicals' construction-in-progress, which now stands at $11 billion compared to $6 billion the previous year. This expansion indicates a substantial increase in the company's ongoing projects.
The analyst pointed out that after completion of these projects, approximately two-thirds of Air Products & Chemicals' gross invested capital could be concentrated in hydrogen and syngas assets. This focus differentiates APD from its competitors, Linde (NYSE:LIN) and Air Liquide (OTC:AIQUY), due to its higher exposure to hydrogen/syngas and a larger percentage of early-stage capital.
"We reiterate our Outperform rating and raise our PT to $385 (from $360) as we believe both APD & activist have potential to further unlock value," Mizuho anlaysts said.
In other recent news, Air Products, a leading industrial gases company, reported strong fourth-quarter results, surpassing market expectations. The company's fiscal year guidance, excluding the liquefied natural gas (LNG) segment, aligns with forecasts, indicating a steady course ahead. Air Products reported a 13% year-over-year increase in adjusted earnings per share for the fourth quarter of 2024, meeting their guidance, and anticipates EPS growth of 6% to 9% for the fiscal year 2025, despite the sale of its LNG business to Honeywell (NASDAQ:HON).
BMO (TSX:BMO) Capital maintained its Outperform rating on shares of Air Products and increased the price target to $350 from $323 following these strong results. Furthermore, Air Products recently received a board nomination from Mantle Ridge for election at the company's 2025 Annual Meeting, which is currently under evaluation by the existing board of directors.
In recent developments, Air Products has been focusing on strategic initiatives to capitalize on the growing clean hydrogen market, with several projects underway. The company's commitment to returning value to shareholders is evident, with plans to return approximately $1.6 billion in dividends.
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